Carry-Over Balances

Carry-over balance information is added in the lease component Definition page, but can be modified for each activation group. This feature is disabled by default. Contact your system administrator to enable it, if required.

At contract inception, this page can be modified when the Contract Phase is "Setup" and the Activation Group Status is "Define". Once it is sent for assessment, the carry-over balance information can no longer be edited.

Note: Because there is no capitalization document, the application uses a spot rate (as of the Activation Date) for the first depreciation posting.

Carry-over fields per accounting standard and asset depreciation values for prior and current years can be enabled at the activation group level. Contact your system administrator if you require these fields. If enabled, the application compares the specified Capitalization Date with the Transfer Date from SAP:

  • When the Capitalization Date is not in the same year as the Transfer Date from SAP:
    • If the prior year Accumulated Deprecation is set, then the application sends it.
    • The application sends the Asset GBV.
    • If Lease Current Year AD is set and:
      • the lease is finance, then the application sends the value to each depreciation area for the accounting standard with Currency Type 10.
      • the lease is ASC 842 operating, then the application sends the value as Unplanned Deprecation.
  • When the Capitalization Date is in the same year as the Transfer date:
    • If a prior year Accumulated Depreciation is entered, the application throws an error message.
    • If no prior year Accumulated Depreciation is set, the application sends the Asset GBV value.
    • If the Current Year AD is set and:
      • the lease is finance, then the application sends the Current Year AD value.
      • the lease is ASC 842 Operating, then the application sends the Current Year AD value as the Unplanned Deprecation for each depreciation area for that accounting standard with Currency Type 10.

Note: The Transaction Types for Unplanned Depreciation and for Current Year GBV are configured in backend configuration. Contact your implementation partner for more information.

Note: If impairment carry-over information is entered and the activation group is classified as ASC 842 operating, no additional events (such as reassessments, indexation events, and casualties) can be performed on the contract, other than an impairment gain (if it is also classified under IFRS 16 or GASB 87) or another impairment loss.

Note that these carry-over balance fields are not available for non-lease service contracts, short term leases, or low value leases.

To modify carry-over balances:

  1. Open the activation group, and click Classification in the left-panel.
  2. Modify the following information, if required. Note that you must always enter amounts for both the local and contract currencies. If one of these carry-over fields are set, the GBV fields become mandatory.
    • If only one set of carry-over balances can be entered:
      • Company Asset GBV: Enter the current asset gross book value in the local currency (i.e., company code currency).
      • Company Asset AD: Enter the current asset depreciation value in the local currency.
      • Lease Asset GBV: Enter the current asset gross book value in the contract currency.
      • Lease Asset AD: Enter the current asset depreciation value in the contract currency.
      • For contracts operating under ASC 842, IFRS 16, or GASB 87 in disconnected or hybrid systems, users can also enter carry-over balance impairment information. Note that the impairment reversal fields are only available for contracts operating under IFRS 16.
        • Company Asset Acc. Impairment: Enter the current accumulated impairment value in the local currency (i.e., company code currency).
        • Lease Asset Acc. Impairment: Enter the current accumulated impairment value in the contract currency.
        • Company Asset Max. Impairment Reversal - IFRS only: Enter the current maximum impairment reversal value in the local currency. Note that the impairment reversal value must be less than the impairment amount.
        • Lease Asset Max. Impairment Reversal - IFRS only: Enter the current maximum impairment reversal value in the contract currency. Note that the impairment reversal value must be less than the impairment amount.
    • If more carryover balances can be entered, the following fields are also available:
      • Override Capitalization Date: Enter the date of when the asset was really capitalized. The application will send this date instead of the Activation Date in the Capitalization Date field to SAP. Note that this field is required.
      • Company Current Year AD: Enter the current year asset depreciation value in the local currency.
      • Lease Current Year AD: Enter the prior year asset depreciation value in the contract currency.

    Note: The GBV amount cannot be less than the sum of the accumulated depreciation, accumulated impairment, and current year depreciation amounts (if they were entered).

See also:  

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